Workers expect their defined contribution plans to play a greater role in their retirement income than annuities.
WASHINGTON, D.C. – The Insured Retirement Institute (IRI) todayissued a statement from IRI President and CEO Cathy Weatherford after the Treasury Department announced a final rule for qualifying longevity annuity contracts (QLAC). The announcement was made today during the IRI Government, Legal and Regulatory Conference by the Treasury Department’s J. Mark Iwry, Senior Advisor to the Secretary and Deputy Assistant Secretary for Retirement and Health Policy.
The QLAC rule will facilitate access to deferred annuity options in qualified retirement plans including individual retirement accounts. With these longevity annuity contracts, the income stream commences at an advanced age, such as age 80 or 85. As such, the use of these options in qualified retirement plans are typically impeded by required minimum distribution rules that kick in at age 70.5. Under the QLAC rule, the value of the annuity contract would be excluded from the account balance used to determine required minimum distributions.
Statement from IRI President and CEO Cathy Weatherford:
“Today’s announcement by the Treasury Department is a major milestone for making lifetime income more readily available to American workers and their families. The availability of longevity annuities in workplace plans and IRAs will facilitate access to a steady stream of guaranteed income throughout a retiree’s later years and help Americans enhance their retirement security at a time when they are most vulnerable to outliving their financial assets or facing reduced standards of living. On behalf of IRI’s member companies, we commend the Administration and the Treasury Department for their efforts to ensure that Americans can attain financial security throughout all their retirement years, and we are pleased that we were able to work with regulators to provide constructive input throughout the rulemaking process to achieve our shared goals. We look forward to continuing our dialogue with policymakers as we partner together to reduce barriers and promote access to lifetime income."
Clickhereto view the Treasury’s announcement.
About the Insured Retirement Institute: The Insured Retirement Institute (IRI) is the leading association for the retirement income industry. IRI proudly leads a national consumer coalition of more than 30 organizations, and is the only association that represents the entire supply chain of insured retirement strategies. IRI members are the major insurers, asset managers, broker-dealers/distributors, and 150,000 financial professionals. As a not-for-profit organization, IRI provides an objective forum for communication and education, and advocates for the sustainable retirement solutions Americans need to help achieve a secure and dignified retirement. Learn more at www.irionline.org.